Asked by Jimmy Christiansen on Jul 14, 2024
Verified
Corine engaged Datz as her agent.It was mutually agreed that Datz would not disclose that he was acting as Corine's agent.Instead he was to deal with prospective customers as if he were a principal acting on his own behalf.In accordance with this agreement,he made several contracts for Corine.If a third party filed a lawsuit on one of the contracts,which of the following statements would be true?
A) Corine is disallowed from ratifying Datz's contracts in order to transfer liability.
B) Datz has no liability once he discloses that Corine is the real principal.
C) The third party can hold only Datz liable since the third party believed that Datz was the principal.
D) The third party may choose to hold either Datz or Corine liable.
Mutually Agreed
A condition or circumstance where all parties involved have consented to the terms or decisions proposed, often used in contracts or negotiations.
Prospective Customers
Individuals or organizations likely to become clients or customers of a business in the future.
Real Principal
The actual entity or individual for whom an agent or representative acts, holding the ultimate authority and benefit in transactions or contracts.
- Outline the differential responsibilities of known and unknown principals.
Verified Answer
CC
Camryn ChristensonJul 17, 2024
Final Answer :
D
Explanation :
The third party may hold an agent liable on contracts made for an undisclosed principal.
Learning Objectives
- Outline the differential responsibilities of known and unknown principals.